Inspector General Weighs in on FFPs

Inspector General Weighs in on FFPs

In a “Follow-Up Review: Performance of U.S. Airlines in Implementing Selected Provisions of the Airline Customer Service Commitment”, the Inspector General reports that “straightforward, comprehensive reporting is needed on frequent flyer award redemptions.” In this follow-up to a 2001 report, the request is almost identical, indicating that very little progress has been made.

The report indicates that information disclosed on frequent flyer redemptions is not comparable across airlines and the inconsistency in reporting makes it “difficult, if not impossible” for consumers to compare frequent flyer programs in a meaningful way. The report also states that seat capacity and frequent flyer redemptions for free tickets have been on the decline. “The combination of six airlines with the largest frequent flyer programs have on average reduced capacity by about 11 percent in 2005 as compared to 2000. This along with deeply discounted fares, has raised load factors, resulting in fewer seats available for redeeming frequent flyer awards.”

In a sample of 598 frequent flyer complaints received by 10 airlines between January and December 2005, the Inspector General found that 23 percent of the complaints were attributed to the customer’s inability to obtain a standard award ticket. It should be noted that frequent flyer complaints represent only about one percent or less of all complaints received by the DOT. The complaint subcategory “Not able to redeem miles” grew from 17 percent in 2001 to 38 percent in 2004, but dropped to 26 percent in 2005.

The recommendation stated in the report is that “air carriers make available to the public a more comprehensive reporting of frequent flyer redemptions, such as percentage of successful redemptions and frequent flyer seats made in the airline’s top origin and destination markets.” The Inspector General makes a plea to the DOTA to examine through rulemaking proceedings the need to standardize the reporting of airline data on frequent flyer redemptions, and concludes with, “This information should include the ratio of the number of seats flown by passengers traveling on frequent flyer rewards to the overall number of seats available and the total number and percentage of redemption at both standard and premium levels. This information should be readily and easily available to consumers.”

Editor’s note: We have long supported the government’s role in assisting in the establishment of basic guidelines for these programs in this area. In years past, we have called for airlines to voluntarily assign a standard of 10 percent of “saver” type awards to every flight, assuring members of a reasonable chance for discounted awards. We do find fault with much of the findings of this report — even though they chose to use data collected by InsideFlyer within the report.

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